2013年9月17日 星期二

Governing the BBC: A row over pay-offs

Governing the BBC

Lights, action, meltdown

A row over pay-offs by the national broadcaster has produced an establishment clash

SHARP-SUITED television executives at the British Broadcasting
Corporation (BBC) covet dramas riveting enough to stop viewers switching
over to their commercial rivals. On September 9th an appearance by
seven of the broadcasting world’s big beasts before the Commons Public
Accounts Committee provided enough tension, vengeance and omens of
further upheaval to fuel an entire series.
Severance payments for senior BBC executives started the spat, but
the implications run far deeper for the national broadcaster. Faced with
pressures to cull a sprawling headcount of managers the BBC’s solution
to dealing with an excess of highly paid executives turned out to be to
pay them an awful lot to go away.

The corporation spent nearly £370m ($585m) over eight years in staff
redundancies and “sweeteners”, often beyond contractual requirements.
The highest-paid fared best: 150 senior departing managers received £25m
between 2000 and 2012. Mark Byford, the former deputy director-general
who left his job in 2010, received over £1m as bosses sought to cut the
management pay bill by a quarter. The cuts were triggered when the BBC’s
licence fee was frozen in 2010. That put a dent in its real-terms
income forcing the push to save cash. But the National Audit Office,
which audits public-sector accounts, concluded that the BBC “breached
its own already generous policies on severance payments” and blamed weak
governance arrangements.
As the BBC is financed by a compulsory levy on all television-owning
households, politicians and viewers have been angered by the misspent
money. The push to discover how it happened has produced energetic
blame-shifting between Mark Thompson, who was director-general until
mid-2012, and Lord Patten, a Tory grandee who heads the BBC’s governing
trust.
Mr Thompson says that he told Lord Patten and Sir Michael Lyons, his
predecessor at the trust, about the pay-offs and had their “full
support”. Further squabbling about who knew what led Margaret Hodge, the
fiery Labour chair of the committee, to deride the “incompetence, lack
of central control, [and] failure to communicate” of the BBC’s top
brass. Under questioning, Lucy Adams, its head of human resources,
appeared unable to remember the content of many of her own memos.
Students of the changing nature of Britain’s establishment have
relished the meltdown of courtesies as the grandees exchanged poisonous
glances and frosty put-downs. Mr Thompson, a self-confident sort,
belongs to a globe-trotting circle of media CEOs and is currently chief
executive of the New York Times. Lord Patten,
who played a key role in the defenestration of Margaret Thatcher as
prime minister, represents a more traditional brand of big-wiggery. He
is also chancellor of Oxford University and organised the handover of
Hong Kong to China in 1997.
Beyond the personal infighting, bigger questions loom. The BBC Trust
now looks especially vulnerable. Its unwieldy governance structure,
drawn up in 2006 in response to a clash with the then Labour government
over coverage of the run-up to the war in Iraq, looks unequal to the
task of financial oversight.
The BBC’s present director-general, Tony Hall, admits that the BBC
“lost the plot” on the payments. He has announced that the trust and his
executive management board will work more closely together. Few think
that is an adequate answer. Alternatives to the trust are likely to be
put forward ahead of the renewal, in 2016 of the Royal Charter which
outlines the BBC’s constitutional status and funding.
One option supported by some ministers in the Tory-led coalition is
to hand the BBC’s regulation to Ofcom, the regulator which already
checks the BBC’s taste and decency standards and that it is adhering to
quotas for programmes supplied by independent companies. Ofcom’s remit,
some think, could easily be extended, in the same way that it regulates
the advertising-financed, publicly-owned Channel 4.
That shift, says Colin Mayer, a corporate-governance expert at Oxford
University, would risk granting a government-appointed regulator too
much sway over what should be an independent media organisation.
Although the reputation of Britain’s regulators in sectors such as the
utilities has improved in the past decade, granting full regulatory
power over the broadcaster to an external body remains controversial.
A better idea, Mr Mayer suggests, would be for the BBC to adopt the
governance structure of companies ranging from IKEA and Bertelsmann to
Tata and Bosch, under which a charitable foundation or trust checks that
the activities of the company are in keeping with agreed values.
Adopting a corporate structure more like mainstream commercial
companies, with an executive chairman, responsible for leadership, clear
management responsibilities and a stronger role for non-executive
directors, might at least cure the BBC’s tendency to pass the buck when
trouble strikes.
An alternative idea, floated by Tessa Jowell, a former Labour
minister, is to make the BBC into a mutually owned company, with 27m
licence-fee payers afforded a more robust say over what it does.
Sceptics worry that this would end up creating thinly veiled political
tribes, competing to act as tribunes of the public. Lord Hall meanwhile,
claims hopefully that the row over pay-offs now belongs “to the past”.
But an argument that started over how much people should be paid to
leave the BBC looks like turning into an even bigger one about how to
run it.